The global expansion of K-beauty demand is driving performance growth in South Korea’s cosmetics Original Design Manufacturing (ODM) industry. As domestic indie brands expand sales in overseas markets such as the United States and Europe, orders for ODM companies responsible for product production have also increased. With Kolmar Korea and Cosmax both reporting record-breaking second-quarter results, K-beauty’s international expansion is solidifying its role as a key growth driver for the ODM sector.
On the 12th, Kolmar Korea disclosed that its consolidated revenue for the second quarter reached 861.3 billion won, with an operating profit of 110.3 billion won. This represents year-on-year increases of 17.8% and 50.2%, respectively. Both revenue and operating profit mark the highest quarterly figures in the company’s history. Notably, the growth rate of operating profit significantly exceeded that of revenue, indicating improved profitability. Net income rose by 68.9% to 70.6 billion won.
Growth momentum continued through the first half of the year. Kolmar Korea’s first-half revenue reached 1.5893 trillion won, a 14.8% increase compared to the same period last year. Operating profit grew by 41.8% to 189.2 billion won, while net income surged by 100.9% to 130.6 billion won.
Kolmar Korea attributed its strong performance to the global expansion of indie brands and peak-season demand for sun care products. Orders increased primarily for skin care and sun care products, alongside continued launches of new products by global clients. As domestic brands expanded their overseas sales, production volumes also rose accordingly.
Cosmax followed a similar trend. The company disclosed on the previous day that its second-quarter revenue reached 794.9 billion won, with an operating profit of 73.7 billion won. These figures represent year-on-year increases of 27% and 21%, respectively, marking record highs for both revenue and operating profit. First-half revenue totaled 1.4769 trillion won, up 22%, while operating profit reached 126.8 billion won, a 13% increase.
Cosmax’s domestic business growth was particularly notable. Its Korean subsidiary recorded revenue of 518.4 billion won, surpassing the 500th-billion-won threshold for the first time in a quarter. This expansion resulted from domestic indie brand clients entering global markets, including the United States. Revenue also increased for high-margin product categories such as sun care and gel masks, centered around basic cosmetics.
Changes were also observed in overseas operations. Cosmax’s U.S. subsidiary reported second-quarter revenue of 53.8 billion won, a 79% year-on-year increase, achieving its first-ever quarterly operating profit since inception. This turnaround was driven by repeat orders from existing major clients and the expansion of sales networks targeting indie brands in the western United States, contributing to both top-line growth and improved profitability.
A common thread in both companies’ results is their strong linkage to the growth of domestic indie brands. In the past, ODM firms directly responded to market growth in specific countries; recently, however, they have participated as production partners during the overseas expansion of Korean brands, delivering tangible results. As overseas sales and product lines expand for these brands, order volumes for ODM companies are rising in tandem.
With growing global demand, production capacity has emerged as a core competitive advantage. Kolmar Korea is operating its second U.S. factory to expand North American production capabilities, while Cosmax is pursuing operational efficiency improvements at its U.S. subsidiary and expanding its local sales network. A key focus for the second half will be whether they can secure local clients beyond their existing base of domestic indie brands.
An industry executive stated, “Recently, K-beauty has entered a phase of expanding both local brands and product categories in export markets. As the global expansion of indie brands continues, it is highly likely that ODM companies supporting this trend will also experience sustained growth.”
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